Cluster Brand

Cluster Brand

　Cluster brand is to manage the cluster as a whole as a brand Business, its brand name is composed of a combination of place name and local characteristic industry, highlighting the economic and cultural characteristics of the enterprise and region, also known as “industrial cluster brand”, “regional brand”, “collective brand”, etc.^[1]. It has two characteristics: regionality and brand effect. Regionality means that cluster brands are generally limited to a region or a city and have strong regional characteristics. Brand effect refers to the image of cluster brands that often represent a local industry or product. For example, French perfume, Milan fashion, Swiss watches, Jingdezhen porcelain, Wenzhou shoes, etc.

Cluster brand is different from corporate brand. First, the subjects of shaping are different. The main body of shaping the cluster brand may be the local regional government, the cluster enterprise association, the alliance of multiple affiliated enterprises in the cluster, or the advantageous enterprises in the cluster. It links a specific industry with a certain geographical or administrative area, which is more vivid and direct than a single corporate brand, and the brand effect is more lasting. The second is that they are different in nature. Cluster brands have the nature of public goods for the enterprises in the cluster. They are the common intangible assets of the enterprises in the cluster. Once the cluster brand is generated, any enterprise in the cluster will enjoy the benefits brought by the cluster brand.

Compared with corporate brands, cluster brands have their own uniqueness, which is reflected in: (1) extensiveness and durability; (2) publicity; (3) externality; (4) abstraction and Concreteness. In addition, regional brands are different from corporate brands in terms of number of owners and brand effect^[2].

Cluster brands are the embodiment of the core competitiveness of the industry. The formation and upgrading of industrial clusters generally require the stages of centralized enterprise establishment, industrial chain, and cluster branding. Cluster branding is an advanced stage of the development of industrial clusters. It is the concentration and refinement of the essence of many corporate brands and the embodiment of the core competitiveness of the industry. In the era of competition with homogenous products and oversupply, brands are the life of products and enterprises. The construction and management of cluster brands is an inevitable choice to enhance industrial competitiveness.

Three major advantages of cluster brands enhance the competitiveness of industrial clusters

Brand management and the process of improving industry core competitiveness are indistinguishable from each other. Brand management is the external manifestation of the improvement of the competitiveness of industrial clusters. Cluster brands achieve the upgrading of industrial clusters; the improvement of the competitiveness of industrial clusters is the purpose and destination of brand management.

Cluster brands are conducive to optimizing the value chain of industrial clusters.

An industrial cluster is an organic whole that integrates raw material suppliers, parts manufacturers, logistics intermediaries, venture capital investors and other entities. Today’s market competition has developed from competition between individual enterprises to competition between industrial clusters with complete industrial chains and value chains. Enterprises within the industrial cluster form various value chains of the industrial cluster through specialized division of labor and social collaboration, which is part of the overall strategy to realize the industrial cluster. The brand effect attracts various resources to concentrate in specific areas. Enterprises in the cluster develop towards high-end through technological innovation. The cluster industry continues to extend to both ends of the industrial chain, gradually forming a more complete industrial chain. New growth poles emerge in the development of industrial clusters. The industry The value chain of the cluster is further optimized and the comprehensive competitiveness is further improved.

Cluster brands are conducive to the appreciation of industrial cluster assets.

First of all, cluster brands are conducive to enterprise resource sharing and effective integration of internal industry resources. Cluster brands are common resources for the development of all enterprises in the region and represent regional industrial competitiveness. Clusters use well-known brands as links to enable a considerable number of small and medium-sized enterprises to gather under one well-known brand. Through the cluster brand, sales channels are shared, forming advantages in distribution and product circulation, as well as price competitiveness brought about by savings in channel costs. Channel clusters and product diversification can enable multiple products of the same brand to occupy a wider market space than a single product, expand brand product production capabilities, and enhance the competitiveness of the entire region.

Secondly, brand extension of famous brand companies can help reduce product costs and increase the brand’s intangible assets. Famous brand companies carry out brand extension and achieve low-cost expansion, which can not only allow some high-quality unlicensed companies to share the intangible benefits of the brand and increase the added value of products, but also spread the brand creation expenses, reduce unit costs, and make the intangible assets of the brand in motion. Add value and improve product competitiveness.

Cluster brands are conducive to enhancing the external influence of industrial clusters.

In the context of economic globalization, competition between regions and enterprises largely depends on brand effects. The competitiveness of industrial clusters is inseparable from the cluster brand. Creating a cluster brand with national and even global influence is an important symbol of the success of a modern industrial cluster. Once the popularity and reputation of a cluster brand are formed, it will become an intangible asset for the entire industrial cluster, allowing the industry to be recognized by the outside world in a short period of time and benefiting individuals in the cluster. At the same time, the reputation of cluster brands will help this leading industry gain a favorable position in industrial division of labor and transfer in the global industrial landscape. Cluster brands are the business cards of industrial clusters, and developing cluster brands is an effective means to enhance the visibility and influence of industrial clusters, enhance the industrial level, and improve the core competitiveness of industrial clusters.

　
In a specific field, a large number of enterprises with close industrial connections and related supporting institutions gather in space and form a strong and sustainable competitive advantage. This phenomenon is called an industrial cluster. When an industrial cluster rises to the level of a brand, it forms Location brand. Regional brands use a format similar to “name of origin + product + characteristics” to characterize specific products in a certain region and make this characterization widely recognized. The essence of branding is to differentiate products. If we define an industrial cluster as a “product”, the cluster can also have its own brand, which is called a cluster brand. Therefore, the so-called industrial cluster product is used to identify the products or services of a certain cluster and differentiate them from those of competitors. Cluster brands should reflect the industrial characteristics and regional characteristics of the cluster, that is, linking a specific industry with a certain geographical or administrative region, such as sports shoes in Jinjiang, oolong tea in Anxi, and women’s clothing in Humen, Guangdong. Cluster brands are conducive to attracting customers and enhancing market penetration; attracting foreign-funded enterprises and non-local private enterprises to enter the cluster to accelerate their formation and growth; they can also attract high-level talents and improve the overall competitiveness of the region.

The meaning of cluster brand includes two aspects. One is the enterprise level, where enterprises in the cluster still use their own brands; the other is the cluster level, that is, the cluster’s common brand or overall brand. The choice of cluster brand creation model should take into account factors such as the size structure (concentration) of the enterprises in the cluster, the effectiveness of the cluster’s common brand, and the characteristics of the product itself.

A good location brand can absorb resources to the maximum extent. For example, the location brand formed by the Jinjiang shoe industry cluster has made Jinjiang a veritable shoe capital in China. The overall brand building and image promotion of the cluster will benefit the cluster itself and all enterprises within the cluster. Cluster brands can spread information, create market demand, build consumer confidence, and repel competitors. Cluster brands have externalities for enterprises within the cluster.

However, industrial clusters cannot automatically generate location brands. Industrial cluster brands can be established through the low-cost advantages of industrial clusters, or through perfect product quality, or through the provision of unique products or services. , or obtained through continuous product innovation and product differentiation. Only when the advantages and functions of industrial clusters are recognized by the outside world can a location brand be formed; and once a location brand is formed, it will give greater impetus to the industrial cluster.

In recent years, the three major economic circles, mainly the Yangtze River Delta, the Pearl River Delta and the Bohai Rim region, have formed a number of Industrial clusters with distinctive personalities; Zhejiang, Guangdong, Jiangsu, Fujian and other places have also begun preliminary exploration of cluster brands, creating a number of cluster brands that are influential and well-known in domestic and foreign markets.

my country’s industrial cluster brands are concentrated in economically developed coastal areas. The list of “2007 China’s Top 100 Industrial Clusters” shows that my country’s industrial clusters with a certain scale and popularity are distributed in 17 provinces, autonomous regions and municipalities across the country, with the five coastal provinces accounting for 85 of them. Among them, Zhejiang Province has 36 industrial clusters selected, ranking first in terms of number, including internationally renowned small commodity producing areas such as Wenzhou, Yiwu, and Haining; Guangdong Province and Jiangsu Province rank second and third in number of industrial clusters respectively, and the selected industrial clusters are respectively The number of selected industrial clusters in Fujian Province and Shandong Province is 6 and 5 respectively. It can be seen that the cultivation of cluster brands requires the soil of market economy and an open entrepreneurial atmosphere. Coastal cities have a long history of business and entrepreneurship, a strong business atmosphere and an open entrepreneurial environment, creating favorable conditions for the development of cluster brands. The more developed the market economy, the more complete the market mechanism, and the more open the geographical location, the healthier the cluster brand development will be.

my country’s industrial cluster brands are mainly concentrated in the manufacturing industry, covering more than 10 industries such as clothing, machinery, electronics, agricultural and sideline product processing, printing, furniture, and food manufacturing. Among the top 100 industrial clusters selected in 2007, only the financial industry cluster in Pudong, Shanghai belongs to the service industry, which is consistent with the development of my country’s manufacturing and service industries. The development of my country’s service industry clusters is relatively slow, while the manufacturing industry clusters have experienced a long period of development and have created a number of cluster brands with strong international competitiveness.

At present, small and medium-sized enterprises are the main industrial entities of my country’s cluster brands. Among the top 100 industrial clusters selected in 2007, there are many well-known cluster brands. Many of these cluster brands started from small and medium-sized enterprises and have continued to grow and develop while exploring domestic and foreign markets. For example, Wenzhou’s leather shoe industry cluster and lighter industry cluster, Haining City’s leather processing industry cluster, Yiwu City’s small commodity industry cluster, Shengzhou City’s tie industry cluster, Zhoushan City’s fishery processing industry cluster, Shantou City’s toy and gift industry cluster, Dongguan City The city’s electronic information products industry cluster, Yantai City’s wine industry cluster, Shouguang City’s agricultural and sideline products processing industry cluster, Harbin’s pharmaceutical industry cluster, Jingdezhen’s porcelain industry cluster, etc. These cluster brands are characterized by geographical proximity, sectoral specialization, and sociocultural identity. Four major issues in cluster brand management in my country

Clusters have brands but no brands. At present, in the process of developing industrial clusters, most industrial clusters follow an extensive development model and basically stay at the OEM production stage. Enterprises in the clusters provide too many outsourced processing services and only charge low processing fees. Brand strategies and There is a big gap between the level of brand management and that of developed countries abroad. my country’s industrial clusters are at the low end of the global industrial chain, and most of the companies in the clusters make wedding clothes for others, resulting in the consequences of having brands but not brands.

For example, a shoe factory in Dongguan provides outsourcing processing services to Nike. As a result, people only know that Nike does not know about this shoe factory, let alone the Dongguan area where the shoe factory is located. Another example is that Guangdong’s watch production accounts for the vast majority of the world market, but it rarely has its own famous brands. Many companies are busy “OEM” production for multinational companies. The average comprehensive cost of watches produced in Guangdong is only 7 yuan, and the ex-factory price is about 10 yuan. After multinational companies put their own brands on them, they sell them for hundreds of yuan. This shows that in the case of “OEM”, most enterprises in the cluster are “working” for multinational companies. Although we have invested a lot of labor and capital, consumed a lot of land, energy and resources, and emitted a lot of “three wastes”, we have only received a small amount of processing fees, and most of the profits have been grabbed by multinational companies.

Lack of leading brand leadership. Many industrial clusters in my country are dominated by small and medium-sized enterprises and lack well-known leading brands to lead the direction of industrial development. Most enterprises have low core competitiveness and are difficult to cope with international market competition. First, cluster industries are mainly concentrated in industries related to daily consumer goods, with low entry barriers, low technology, talent and scale requirements for enterprises, and insufficient independent innovation capabilities. A large number of small and medium-sized enterprises engage in low-level duplication on the basis of imitation. Second, most cluster products are mainly medium and low-end, and are increasingly threatened by international technical trade barriers, hindering their expansion into the international market. Third, industrial clusters mainly rely on the advantages of low-price, volume, and OEM to participate in international market competition. Their ability to cope with rising international raw material prices is limited, and their low-cost strategies are challenged.

Cluster brands cannot be effectively protected. Enterprises have low awareness of the brand development of industrial clusters. They do not regard industrial clusters as promotional entities similar to enterprises. Many corporate brands are dispersed and it is difficult to form synergy. The voice of industrial clusters is weak, they lack the right to speak in the market, and they do not pay attention to the registration of cluster trademarks. and protection. For example, the famous textile town “Xiqiao” in Guangdong has actually been registered as a trademark in an individual’s name, which means that more than 1,000 textile companies in Xiqiao Town can no longer use the “Xiqiao” trademark. , the golden signboard that has been operated by many local companies for more than a hundred years has fallen by the wayside. The word “Dali” in Dali Town, known as the “No. 1 Aluminum Town in China” in Guangdong Province, and the word “Yanbu” in Yanbu Town, which is famous for its underwear production, have also been registered, which has a negative impact on local industrial cluster brands. It will also have a huge negative impact on the entire regional economy.

There is a shortage of brand management talents. Most of the industrial clusters are small and medium-sized enterprises. Many enterprises started their fortunes from handicraft workshops. Their middle-level management cadres are mainly directly promoted from skilled workers. They are familiar with the production process, but have not received professional brand management training and lack scientific brand management. Knowledge. The lack of brand management talents has become a bottleneck in the development of China’s traditional industrial clusters. Enterprises play the main role and promote the upgrading of cluster brand management

Different brand strategies are adopted at different stages of development. Enterprises in the development stage must strive to become bigger and stronger and be fully prepared to build cluster brands. Enterprises in the mature stage should focus on expanding the visibility and reputation of leading enterprise brands, promoting the branding of industrial clusters, and enhancing the competitiveness of industrial clusters in both international and domestic markets by creating well-known cluster brands. Enterprises in the upgrading stage should strengthen industrial technological innovation, integrate into the international industrial chain, create new market space, firmly grasp the strategic focus of brand management, align with international standards, enter mainstream business districts, form core values, and build century-old stores.

Accelerate the creation of self-brand. A considerable number of industrial clusters in our country have entered the global industrial chain. Small and medium-sized enterprises cannot always be satisfied with OEM production for global OBM companies, but must speed up the creation of their own brands, thereby promoting industrial upgrading and transformation, and developing from the OEM stage to the ODM/OBM stage. From low-end manufacturing to high-end creativity, from imitation to innovation, from manufacturing to creation, from OEM to brand creation and other high-level directions. We will work hard on independent research and development and international marketing channels to build a global marketing network and cultivate the company’s independent research and development capabilities.

Focus on brand quality and management. Focus on improving the value of the brand, strengthen the creation of independent intellectual property rights and core technologies; endow famous brand products with rich cultural heritage and unique spiritual connotations; pay attention to improving pre-sales, in-sales and after-sales services to maintain the reputation of products , improve the added value and attractiveness of products. While focusing on brand quality, we must also strengthen brand management and improve brand development efficiency. Well-known brand enterprises should do a good job in brand extension development, take advantage of high brand awareness and reputation to develop into serialization, diversification and new categories, and form a brand industry chain; establish an awareness of international competition, register trademarks abroad, and make full use of various carrier, and strive to build corporate brands and cluster brands into internationally renowned brands.

Strengthen brand marketing and protection. Strengthen brand marketing concepts and expand the visibility and reputation of cluster brands. Carry out brand publicity and promotion through various media such as websites, newspapers, and television; improve corporate brand awareness by organizing and participating in various domestic and foreign expos, exhibitions, and industrial museums; actively participate in brand promotion activities organized by the government, such as participating in government delegations , Participate in promoting the “Brand Journey” and other activities to improve the overall image of the corporate brand. At the same time, enterprises should increase efforts to protect cluster brands. Cluster brands are “public goods”, and some enterprises in the cluster may adopt “free-riding behavior”. In order to avoid the tragedy of “public grassland” and the emergence of “lemon market”, corresponding protection mechanisms should be adopted for cluster brands, and brand quality certification and Supervision is particularly important. Enterprises must also do a good job in protecting their own brands, registering the brand as a trademark, legalizing the cluster brand, and preventing tragedies such as trademark infringement, patent preemption, and core technology being plagiarized.

Strengthen cooperation with international brand companies. As a regional economic platform, the development of industrial clusters must be restricted by local resources, environment, technology, talents, etc., and strong companies can use their own brand effects to form alliances with well-known domestic and foreign companies to communicate with each other inside and outside the cluster. , to make up for problems such as lack of funds, insufficient talents, and technical shortages. Moreover, this relationship will not affect the inherent independence of the system, and is conducive to saving resources, increasing the speed of technological innovation, reducing risks, and improving the overall competitiveness of the system. Therefore, enterprises must strengthen cooperation and exchanges with international brand companies, and rely on the technology, management models and popularity of international brand companies to enhance the position of my country’s industrial clusters in the global industrial chain.